MYEGs Enterprise Layer 1 Blockchain Zetrix initiates initial exchange offering on Coinstore
Posted on February 20, 2023
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For blockchain projects that generate a lot of buzz, IEO platforms can help them raise capital quickly. Just look at BitTorrent, which managed to raise $7 million just 14 minutes after its listing on Binance Launchpad went initial exchange offering news live (it was later bought by Tron). That said, there are some marked differences from initial public offerings and IEOs you need to be aware of. Initial exchange offering has become a popular blockchain fundraising technique. So, potential investors can buy tokens without fear of losing their money to scams.
Tips for launching a successful IEO
For this reason, token issuers wishing to participate in an IEO are required to pay a listing fee, as well as a percentage of the tokens sold during the IEO. This can be a deterrent for some token issuers, as listing fees can be expensive and, in some instances, exchanges may take as much as 10% of the tokens sold during https://www.xcritical.com/ the IEO. Conducting fundraising through an exchange platform reduces the token issuer’s need to implement vetting procedures on their clients (if they have capacity and ability to do this in the first place).
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They deter crime, put fraudster in jail, recover billions for investors, and protect the integrity of the markets. The SEC has created the safest reporting system ever devised to incentivize the disclosure of fraud. If you’re in search of deep expertise, consider reaching out to Kohn, Kohn & Colapinto LLP. With a legacy of major legal victories and the inclusion of a former acting chair and commissioner of the SEC as of counsel at the firm, our profound knowledge of securities law positions us uniquely to guide you through the whistleblower process. Your best defense and advantage in the crypto space is a top legal team; don’t hesitate to enlist our support.
Roles and Responsibilities of the Exchange and the Project Team
Since the reputation of a crypto exchange that conducts the IEO in crypto can be damaged if the project turns out to be fraudulent, crypto exchanges usually conduct a thorough check of projects. Reliable crypto exchanges conduct a comprehensive analysis of the white paper and many other aspects of the project before deciding to perform an IEO. This significantly reduces risks for investors and the time spent by investors on their own analysis of the proposal. The first thing investors need to do is to create an account with the exchange that will list the token they want to invest in. Since it can be hard to predict which exchange each token will list with, it can be a good idea for investors to have accounts at multiple crypto exchanges. One of the benefits of IEOs compared to ICOs and IDOs is that centralized exchanges employ teams of researchers to vet crypto projects before listing their tokens.
Link with appropriate exchanges
Commonly considered ICO 2.0, IEO is an evolved version of ICO equipped with regulatory properties. It was introduced in 2019 when the entire ICO market witnessed its unfortunate demise. With the advent of blockchain, the world is escaping the traditional methods of crowdfunding for startups and business organizations. This is when we talk about Initial Coin Offering (ICO) and Initial Exchange Offering (IEO).
How to Participate in an IEO: A Guide for Investors
Most crypto exchanges will require new investors to go through the KYC process. This includes uploading a copy of the investor’s ID, taking a photo with their webcam, and verifying their phone number and email address. New crypto projects can undergo verification through crypto audit services like Certik and Coinsult.
Step 1: Create an Exchange Account
GamesPad, one of the largest crypto and gaming launchpads, specializes in gaming-related crypto projects, NFTs, and the metaverse. With its multi-chain functionality, it simplifies investment and offers a wider range of opportunities. Collaborating with top projects across Ethereum, Binance Smart Chain, and Polychain, GamesPad prioritizes community engagement by providing decentralized IDO platform access to investors and entrepreneurs. This shift marked a significant development in how crypto projects raised funds, offering a safer investment environment.
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A crypto project’s whitepaper is its guiding document for investors and one of the best IEO sources. The whitepaper should clearly explain what the project is all about, including what problem it’s solving and what the token will be used for. Like all crypto investments, IEOs carry risks, and there’s no guarantee you’ll make returns on your money. After all, many meme coins have seen huge surges in value following their IEOs only to tank afterward, leaving some investors out of pocket. It’s not uncommon for hyped cryptocurrencies to see big price increases very quickly after listing on an exchange.
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✓ Use an electronic system provider that facilitates the offering of digital tokens and will conduct due diligence on the tokens and issuers. For individuals wanting to participate in new blockchain project token releases, the environment can be extremely high risk with a large number of scams and little regulation, as well as the environment being highly exposed to hackers. There have been many instances where individuals have accidentally sent their funds to the wrong wallet, and some cases where project teams have absconded with funds. ScaleSwap has made a name for itself in the IDO market by focusing on providing transparent and fair investment opportunities.
- Thus, we suggest that many retail investors previously seeking short-term returns are no longer active in token markets and interested in IEOs.
- Interested investors can buy these tokens from the platform in the form of cryptocurrencies or tokens, which can either be spent on the platform or traded.
- As the market evolves, advisors must regularly advise clients on trends, risks, and developments to make informed decisions on any ICO prospects.
- IEOs play a crucial role in the crypto ecosystem by providing investors with a more secure and regulated environment.
- On the contrary, blockchain technology enables a decentralized ecosystem where users can interact without the need for a central authority.
Just like ICOs, with IEOs, investors can get new tokens (or cryptocurrencies) while raising funds for cryptocurrency projects. In crypto exchanges, funds are raised on behalf of startups while taking in place due diligence and other commitments. On the exchange platforms, cryptocurrency projects conduct a sale of tokens where token issuers are supposed to pay a listing fee to exchange. The first major exchange to offer an initial exchange offering and popularise this practice was Binance with its IEO platform, Binance Launchpad. In January 2019, Binance launched its first IEO, the BitTorrent Tokens (BTT) sale, where tokens sold out in less than 18 minutes and raised over $7.1 million. A few days later, the new token was added to Binance’s listings and almost immediately showed a price increase of over eight-fold.
Notably, the consensus algorithms that rely on mining to verify transactions are very energy intensive and as more people join the industry, energy consumption will skyrocket. For instance, Evedo is a project that seeks to leverage the technology in event organizing. Notably, the platform brings together all the participants and businesses that make up the event organizing ecosystem. Once the entity is verified, the next step is to just fund the wallet with IEO supported cryptocurrencies However, the cost of IEOs could be a bit higher than ICOs.
Collaboration with crypto exchange platforms helps token issuers reduce marketing efforts. Moreover, startups can continue better contributions to their projects with stable customer base exchanges provide. In this stage of token developments, make sure that your budget meet teh requirements well. Funding hardcopy should be formed to present the investors that idea is achievable with this much development cost and market adaptability.
However, with BSCPad, everyone who holds the taken are given their fair share, no matter how much or little the investment. Cryptocurrency aggregators can also help you identify potential scams or real opportunities. Aggregators do not vet new cryptocurrencies; they are only informational in nature. Many will provide links to the project’s Gihub pages, websites, and social media pages and discuss issues the project is attempting to solve. They can be listed immediately after the token sale, ensuring high liquidity and the ability to roll out in the market.
